641 F.2d 619 (9th Cir. 1980), 79-4426, California Medical Ass'n v. Federal Election Commission

Docket Nº:79-4426.
Citation:641 F.2d 619
Party Name:CALIFORNIA MEDICAL ASSOCIATION, a not-for-profit unincorporated association, California Medical Political Action Committee, a political committee, Sidney E. Foster, M.D., and E. Kash Rose, M.D., Plaintiffs-Appellants, v. FEDERAL ELECTION COMMISSION, Honorable Joan D. Aikens, Chairman, Honorable Robert O. Tiernan, Vice-Chairman, Honorable Thomas E.
Case Date:May 23, 1980
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

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641 F.2d 619 (9th Cir. 1980)


unincorporated association, California Medical Political

Action Committee, a political committee, Sidney E. Foster,

M.D., and E. Kash Rose, M.D., Plaintiffs-Appellants,



Chairman, Honorable Robert O. Tiernan, Vice-Chairman,

Honorable Thomas E. Harris, Commissioner, Honorable John

McGarry, Commissioner, Honorable Vernon E. Thompson,

Commissioner, Honorable Max Freidersdorf, Commissioner,

Honorable J. Stanley Kimmit, Secretary, United States Senate

and Ex-Officio Member of the Federal Election Commission,

Honorable Edmund L. Henshaw, Jr., Clerk, House of

Representatives and Ex-Officio Member of the Federal

Election Commission, Defendants-Appellees.

No. 79-4426.

United States Court of Appeals, Ninth Circuit

May 23, 1980

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Rick C. Zimmerman, Hassard, Bonnington, Roger & Huber, San Francisco, Cal., for plaintiffs-appellants.

David Branch, Washington, D. C., on brief; Charles N. Steele, Washington, D. C., for defendants-appellees.

Appeal from the United States District Court for the Northern District of California.


KENNEDY, Circuit Judge:

This is an appeal from an order of the district court certifying four questions concerning the constitutionality of limits on contributions to a political action committee under the Federal Election Campaign Act as amended in 1976. 1 2 U.S.C. §§ 431-442,

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451-455 (1976) (as amended, 1980). We hear the appeal en banc pursuant to Fed.R.App.P. 35. Standing and jurisdiction are conferred by, inter alia, 2 U.S.C. § 437h(a) (1976). See Buckley v. Valeo, 424 U.S. 1, 8-12, 96 S.Ct. 612, 629-31, 46 L.Ed.2d 659 (1976) (per curiam).

The case turns on important statutory provisions pertaining to entities defined by the Act as political committees. CALPAC is a political committee affiliated with the California Medical Association (CMA). CALPAC and CMA were two of the plaintiffs below. The other plaintiffs were individual members of CMA named Foster and Rose, who are eligible voters with standing to bring the action pursuant to 2 U.S.C. § 437h(a) (1976). The plaintiffs below are appellants here.

The appellants make two principal arguments. First, they contend the Act's limit on contributions by CMA to CALPAC is an infringement of their first amendment right of speech and political expression. Second, the appellants challenge the FEC's interpretation of the Act which requires that administrative support given by associations such as CMA to a multicandidate political committee must be counted as part of the dollar limit set on payments to such committees, when, by contrast, a labor union or corporation may give unlimited administrative support to a subspecies of political committee designated under the Act as a "segregated fund." The appellants allege that the FEC's interpretation of the Act is incorrect as a matter of statutory construction, or, that if it is correct, it is unconstitutional. Each of the appellant's principal contentions is erroneous and each is rejected.


In 1976 the Supreme Court held it was constitutional to limit contributions to candidates in federal elections to $1,000. Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976) (per curiam). Following the Buckley decision and as a matter of legislative grace, 2 Congress opened a wider avenue by which individuals could channel funds to candidates: any person, including both natural persons and various kinds of organizations, could contribute up to $5,000 to multicandidate political committees, which in turn could contribute up to $5,000 to each candidate. In this way Congress permitted greater individual contribution possibilities.

Appellants would have us dramatically widen this avenue of indirect contributions to candidates. They use the statutory rule permitting a corporation or union to furnish limited kinds of clerical and similar services to its own segregated fund as a fulcrum in an attempt to dislodge as unconstitutional a critical provision of the Act which limits an association's payments to political committees. The irony of the argument is that corporations and unions are entities generally forbidden to influence federal elections by either expenditures or contributions. To accept appellants' constitutional theory would allow associations to channel to any and all political committees, and thence to candidates, unlimited amounts of cash, services, or other things of value. To drive this

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wedge through the narrow aperture of section 441a would be to shatter the careful design of the Federal Election Campaign Act. The first amendment does not compel or support that result.

Our colleagues in dissent propose a theory that not only would strike down the provisions before us but also would portend grave consequences for other major features of the Act, not the least of which are the $25,000 annual limit on aggregate individual contributions and the rule that corporations and unions can make no campaign contributions or expenditures at all. Furthermore, an incidental, but nevertheless far-reaching, consequence of the dissent would be to grant associations a special privilege of unlimited and direct contribution ability, a privilege not extended to individual persons. 3 That distinction appears to us quite unsupportable.

The provisions we examine here were designed to protect the integrity of the political process and to insure that political debate and political speech are effective, and in this regard Congress acted to vindicate first amendment interests, not to derogate them. We find therefore, that the statutory provisions challenged in this case are constitutional.


$5,000 Limit on Payments to Political Committees

As enacted in 1974, the Federal Election Campaign Act imposed dollar limitations both on contributions to candidates and on independent expenditures made by or on behalf of candidates in federal elections. The provisions on candidate contributions were held valid but limits on independent expenditures by or on behalf of candidates were held unconstitutional in Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976) (per curiam). In response to the decision, Congress amended the Act. Federal Election Campaign Act Amendments of 1976, Pub.L.No.94-283, 90 Stat. 475 (codified in 2 U.S.C. §§ 431-442, 451-455 (1976) (as amended, 1980)). Consistently with the mandate of the Supreme Court, Congress amended the Act to remove any limitations on independent expenditures. Congress enacted new limitations on permissible payments to political committees, 2 U.S.C. § 441a(a)(1)(C) (1976). It is apparent, therefore, that Congress considered payments to a multicandidate political committee to be subject to the same regulatory power, from a constitutional standpoint, as campaign donations made directly to candidates. Upon consideration of the statutory definition of a political committee and by reason of the substantial latitude permitted associations for political expression, including the right to make unlimited expenditures except for direct candidate contributions or payments to multicandidate political committees, we hold that the Congress was correct in its judgment. Appellants make the assertion that Congress had a very limited purpose for enacting the $5,000 limitation, 4 and then proceed to declare that its purpose, as so defined, is just as readily accomplished by other provisions of the Act. They state that the $5,000 limit is only to prevent funneling contributions to a particular candidate and cite section 441a(a)(7)(B)(i) to show that indirect funneling to specific candidates is separately forbidden. This is a crabbed view of the Act and an unrealistic appraisal of the definition and role of a multicandidate political committee.

At the outset it should be noted that a person or an organization, such as CMA, can contribute each year no more than $1,000 to any candidate. 2 U.S.C. § 441a(a)(1)(A). This provision, as we have said, was expressly validated in Buckley. A

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political committee qualified as a multicandidate committee, as CALPAC is, may give a maximum of $5,000 per year to any one candidate. 2 U.S.C. § 441a(a)(2)(A). If the limits on payments to a political committee were to be erased, any association could give unlimited funds to a political committee. Donors could in effect use the multicandidate committee as a vehicle for making $5,000 contributions to an unlimited number of candidates and thereby influence, in fact as well as appearance, the use of vast and substantial sums for direct candidate contributions. That would be an egregious distortion of the existing contribution limits of the Act, provisions specifically sustained by the Court in Buckley.

The 1976 amendments gave political action committees great and unusual powers in comparison to either candidates or individuals: Political action committees are unlimited in the total amounts of money they receive, expend, and contribute to candidates. To vest such extraordinary power in political action committees, without some reasonable limits such as section 441a(a)(1)(C) on how they can collect money, would be to create novel and potentially enormous opportunities for corruption. As one study has concluded, even as limited by section 441a(a)(1)(C), political action committees have become vast, unaccountable, and low visibility centers of electoral influence that effectively detach candidates from their nominal geographic constituencies. See Institute of Politics, John F. Kennedy School of Government, Harvard University, An Analysis of the Impact of...

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